Ebay: VAT on Postage
There are quite a number of sellers out there who are
profiting from postage and packaging charges on Ebay. But before
you complain the next time you purchase something on Ebay, bear in mind the hidden costs
of postage and packaging – Jiffy bags, bubble wrap and labels do not come
for free and more importantly – a VAT registered seller needs to pay VAT to
Revenue on the total payment received which includes the cost of postage and
packaging (which in a lot of cases will be inclusive of VAT at 21%).
This is due to postage being classed as a service provided to
the buyer. Worse still – there’s no VAT to claim back from the postage the seller buys.